1Q26业绩因意外外汇损失不及预期；出货量和利润率稳健，评级下调至持有

China (PRC) | Alternative EnergySunwoda 1Q26 Results Missed on Surprise FX Losses;Shipments & Margin Solid. DG to Hold Excl one-off litigation and ESOP costs, Sunwoda’s FY25 core earnings metexpectations. Its 1Q26 rev rose 31% YoY; EV/ESS gross margin improvedto 14–15%, but consumer revenue was flat and RMB320mn in FX lossesweighed on net profit. Mgmt raised its 2026 EV/ESS shipment target to90GWh, but margins remain exposed to higher lithium prices and currencyrisk. Downgrade to HOLD given limited catalysts for a rerating. FY25 and 1Q26 results: Pros:Rev grew 11% YoY in 4Q25 and 13% YoY in FY25, meetingexpectations. 1Q26 rev rose 31% YoY, mainly due to strong EV/ESS battery sales. The companyfulfilled its 2025 shipment target with 30GWh delivered (+46% EV, +266% ESS), and shipmentsincreased over 80% YoY in 1Q26. EV/ESS segment revenue was up 25% YoY in 2025 andmore than doubled in 1Q26, raising its share of total revenue to 30% in 2025 and 35% in 1Q26.Consumer battery gross margin improved 1.8ppt YoY in 2025; EV/ESS gross margin roseto 14% in 2025 and 14-15% in 1Q26.Cons:Consumer battery revenue was flat in 2025 and1Q26. The company incurred RMB700mn litigation costs and RMB220mn ESOP expense in2025; core earnings excluding these were ~RMB2bn. 1Q26 saw RMB320mn FX losses (2.8xnet profit). R&D spending remained high QoQ in 1Q26 due to increased headcount supportingproduct and customer growth. Mgmt guided up full-year EV/ESS battery shipment target for 2026: EV/ESS battery biz: Mgmt raised the 2026 shipment target to 90GWh (50–60GWh power, 30%+energy storage) from 80GWh, about 2.1x 2025 shipments, citing strong 1Q26 results. Segmentrevenue is projected at RMB30–40bn in 2026 (>59% YoY growth). ESS system biz: The company expects >30% growth, with orders at 3–5x current capacity andplans for orderly production expansion. Consumer battery biz: 1Q26 revenue was flat YoY, as market-share gains offset weak demand.Mgmt targets renewed growth, aiming for >50% self-supply of battery cells in 2026. Liwei isexpected to deliver >30% YoY revenue growth, driven by market share expansion, and a newNorth America customer will be onboarded in 2H26. Margin to remain under pressure from higher lithium prices and FX losses: GPM of both the power and consumption biz are under pressure from raw material pricehikes. A price-cost linked mechanism has been established, but price hikes are lagging. Thecompany’s inventory increased from Rmb7bn at the beginning of 2025 to Rmb14 bn by theend of 1Q26 with proactive stockpiling during the price increase period. The Indian rupee, Thaibaht, and other currencies have depreciated significantly against the RMB (by more than 5%),and there are limited hedging tools available for these currencies in China. The company's localprocurement was insufficient, resulting in a unilateral exposure. Downgrade to HOLD:We cut our earnings forecast for Sunwoda in 2026-2027 by 10-15%. Wecut our PT from Rmb29 to Rmb25, based on lower earnings forecast and the same target P/ Kelly Zou * | Equity Analyst852 3767 1116 | kelly.zou@jefferies.com The Long View: Sunwoda Investment Thesis •Excl one-off litigation and ESOP costs, Sunwoda’s FY25 core earningsmet expectations. Its 1Q26 rev rose 31% YoY; EV/ESS gross marginimproved to 14–15%, but consumer revenue was flat and RMB320mn inFX losses weighed on net profit. Mgmt raised its 2026 EV/ESS shipmenttarget to 90GWh, but margins remain exposed to higher lithium pricesand currency risk. We downgrade to HOLD given limited catalysts for arerating. Downside Scenario,CNY16, -46% Upside Scenario,CNY32, +7% Base Case,CNY25, -16% •Our bear-case PT of Rmb16 is based on atarget 2026E P/E multiple of 15x.•Deteriorating global EV and ESS demandoutlookand intensifying competition inChina's power battery market drives de-ratingof Sunwoda again. •Our base-case PT of Rmb25 is based on atarget 2026E P/E of 20x. •Our bull-case PT of Rmb32 is based on atarget 2026E P/E of 25x.•Globalconsumerelectronicsdemandrecovery beats market expectations.•Itspowerbatterybusiness'domesticandoverseas m/s gain exceeds marketexpectations.•Its power battery business turns profitable. Sustainability Matters Catalysts •Consumerelectronics/EV/ESSbatterydemand is better than market expectations.•M/s expansion in smartphone/PC/EV/ESSbattery segment beats market expectations.•Profitability improvement in EV batterysegment is greater than market expectations. Top Material Issue(s): 1.Product quality: Battery’s safety issues will remain a major concern as EV penetrationincreases, and therefore it is critical for battery manufacturers in terms of winningmarket share and being socially responsible.2.Customer services: Being customer-centric, Sunwoda actively listens to customerfeedback to create more value-added products and services. Company Target(s): 1.Raise quality of development, stay focused on technological & product innovation.2.Enhance supply chain management and push cost reduct